Exhibit 10.14
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DATE: July 29, 2002
TO: FuelNation (BORROWER)
0000 XX 00xx Xxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
FROM: Shaikh Isa Mohammed Isa Alkhalifa and or his appointee, (INVESTOR)
Villa 000, Xxxxxx Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx
RE: $330 Million Bond Financing letter of credit
This letter will confirm our understanding and agreement to provide a cost of
issuance and shortfall letter of credit for the taxable municipal bond issue in
amounts equal to approximately 3.5% (three and one half percent) of the bond
amount for a total of approximately $10,500,000 in three installments of
approximately $3,500,000. The letters of credit will be available for the series
A, B, C of the bond offering or any portion thereof, subject to your prior
commitment you received from the investment fund located in Portland, Oregon.
Transaction: FuelNation will issue a taxable Municipal Bond Issue in
the amount of $330,000,000 USD in three series, A,B,C of approximately
$110,000,000 each, for the purpose of developing a public purpose Travel and
Transportation center in Davie, Florida and the acquisition and consolidation of
five (5) petroleum marketers/petroleum transporters and centralize the
acquisitions with automation and tracking of petroleum from the state of Ohio.
FuelNation will use a Public Agency as defined in Chapter 163, Florida Statutes
for the bond issuance with an interlocal agreement between a public agency in
Ohio and Florida. The Underwriter will sign a Note Purchase Agreement, at the
time of marketing the notes, to purchase all of the debt. The proceeds from the
sale of the notes are placed with the note holders' Trustee. The Trustee places
the proceeds from the sale of the notes and the proceeds of the Shortfall Letter
of Credit ("LOC") with a bank rated AA or better by S&P.
Shortfall LOC: The Shortfall LOC has a ten (10) day life and is used
in accordance with the S&P requirements to transmit proceeds to the Trustee. The
Shortfall LOC is in an amount sufficient to cover the difference between the
interest on the notes and the interest earned on the Investment Agreement paid
by the Investment Agreement Bank computed to the Maturity Date. In order to get
a clean bankruptcy opinion for the closing, the Shortfall Bank agrees to use its
own funds for the issuance of the LOC. It agrees with the Issuer that it can
reimburse itself, in accordance with a reimbursement agreement between it and
the Issuer, upon the cashing of the Shortfall LOC from the funds previously
placed in the bank.
Security: The Letter of Credit from the investor will only be drawn at
closing of the bond funding to pay for the cost of issuance and the short fall
letter of credit fees. Repayment of the letter of credit will be secured with an
irrevocable assignment of proceeds, payable to the investor or their assigns, to
be placed with the escrow agent that holds the letter of credit and to be paid
upon the first draw from the bond proceeds, approximately Twenty-Five (25)
business days.
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Due Date: The full amount of the draw, plus interest and unpaid fees,
will be due Twenty-Five (25) business days after the letter of credit is drawn
at closing.
Disclosure: FuelNation will supply the investor with a commitment for
the bond offering and an acceptable irrevocable assignment of proceeds for the
letter of credit amount to be placed with the escrow agent that holds the letter
of credit.
CONDITIONS FOR DRAW:
Written notice from the Trustee or Political Body that it has entered into a
deposit agreement for the investment of the proceeds of the Notes and the
Shortfall Letter of Credit in a form which is acceptable to S&P ; and
Written notice from the Trustee that it possesses the Shortfall Letter of Credit
and deposited the proceeds thereof into the Secured Note Fund; and
Written notice from Political Body that it has received final verification from
the certified public accounting firm that the Deposit Agreement will generate
revenues sufficient to pay the debt service on the Notes when due. Written
notice from Political Body's bond counsel that it has received and delivered all
legal opinions required to complete the Offering; and
Written notice from Political Body at pre-closing that it has received from S&P
a rating letter providing a rating for the Notes of "AA" or better; and
Written notice from the Trustee that it has received the Note proceeds in the
Secured Note Fund for the benefit of the note holders or an executed Bond
Purchase Agreement supplemented by a letter from the Underwriter that all
conditions have been satisfied, and that it will deliver the Note proceeds on
the date specified as the Closing Day of the Offering; and
Written Notice from the investor that it has received an assignment of proceeds
for the repayment of the letter of credit from the escrow.
AGREED TO AND ACCEPTED THIS 29TH DAY OF JULY 2002
FUELNATION, INC. INVESTOR
By: /s/ XXXXXXXXXXX X. XXXXXXXXX /s/ SHAIKH ISA MOHAMMED ISA ALKHALIFA
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Xxxxxxxxxxx X. Xxxxxxxxx, President
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